Thursday, July 6, 2017

President Trump’s Budget Correct to Eliminate Student Loan Giveaway

Among the many items in President Trump’s proposed 2017 budget is the elimination of the nation’s Public Service Loan Forgiveness program. Created in 2007 under the Bush administration, the program was intended to encourage college graduates to pursue careers in public service in exchange for having their federal student loans forgiven after 10 years of payments.

In practice, however, it’s turned out to be a giveaway that threatens to become another massive taxpayer boondoggle.

As USA Today notes, under the program, teachers, doctors, nurses, first responders, social workers and other public-service workers could eliminate their student loan debt after landing full-time employment with a qualified employer (such as a hospital or public school), getting enrolled in a qualifying repayment plan and making 120 monthly repayments.

Trump’s proposal to cut the program would save an estimated $859 million. Given the program’s flaws and inherent inequities, it’s the right move.